Market Updates

1.       As a province with prosperous duty-free business, Hainan island opened another shopping mall, covering over 200 international brands, including La Prairie, Estee Lauder, Lancome, LA MER, SK-II, etc. Among them, La Prairie creatively opens an experience store that provides high-end on-site skincare service. This shopping mall also exclusively introduces high-end niche perfume brand Maison Margiela.

2.       Tmall removed male cosmetics, perfume, pet, and fashion toy from the original sector they belonged to, and upgraded them to top tier categories. This move implies the strategic position of the four categories rises, and brands in the four categories will get more support from Tmall.

3.       On September 2, Tmall Global announced the “Emerging Beauty Brands Nurture Plan”, aiming to introduce 1,000 overseas emerging beauty brands to China and nurture over 50 beauty brands with over 10 million yuan annual turnover respectively. The plan will focus on skincare products with special ingredients, clean beauty, makeup brands popular on Instagram, and niche fragrance.

The chosen new brands will get full support from Tmall Global in various ways, covering marketing, subsidy, supply chain, traffic, etc. More details on ChemLinked.

Company Dynamics

1.       Swedish niche salon fragrance brand Byredo is seeking buyers. Byredo's products are produced in Sweden and are currently sold in 45 countries and regions. Byredo‘s product line has been expanded to cover boutique perfumes, household fragrances, body skincare products, accessories series, etc. In October 2020, Byredo's first make-up series was also officially launched.

2.       Home cleaning brand, Halfist, received another round of financing, securing millions of dollars. This brand was founded in March 2020, with the Gen-Z as its core consumers. Its ace product is toilet cleaners. According to the data of its Tmall flagship store, the sales of its toilet cleaner reached 60,000 units.

3.       JD Sports Fashion is seeking to acquire Missguided, a British fashion beauty retailer focusing on Gen Z. Missguided was founded in 2009 and has grown into one of UK’s largest online fashion and beauty retailers. In January 2021, it launched 148 vegan and cruelty-free products to the cosmetics market.

4.       Shanghai Mudi e-commerce company, the parent company of Moody, a popular cosmetic contact lenses brand, recently launched a new personal care brand, pinpoint. The company claims that this brand is jointly researched and developed by doctors of the Chinese Academy of Sciences and also invites dermatologists as its consultants. Mudi is famous for Moody and popular among famous investors, including Tencent and Little Red Book.

5.       Yiqi Yihui(一期一会), an emerging Chinese skincare brand, completed its A-round of financing, securing tens of millions yuan. This brand officially entered the market in May and achieved great sales on Tmall. Besides products’ efficacy, this brand’s biggest selling point is independent mini-sized packaging.

6.       Popular Chinese fragrance brand, Scent Library, recently got exclusive investment from PUIG, a Spanish beauty giant. PUIG owns many famous beauty brands, including fragrance brands (PENHALIGON’S and L’Artisan Parfumer), a makeup brand (Charlotte Tilbury), and skincare brands (Apivita, Derma, Uriage, etc). PUIG’s investment on Scent Library implies its confidence in this brand and also Chinese fragrance market.

7.       Multiple Chinese functional skincare brands gained investment recently:

PUskinology received nearly 100 million yuan investment. Its ace product is 10% VC essence spray, which innovatively solves the problem that Vitamin C is easy to oxidize and difficult to preserve.

Another functional skincare brand, SKINAWAKE, received tens of millions of yuan investment. Founded in 2018, this brand started full-scale promotion on social media in June 2021. Its GMV in August exceeded 10 million yuan, mainly attributed to the great sales on Douyin.

FORYON is another functional skincare brand securing investment in September. Founded in March 2020, this brand focus on developing products for consumers with oily skin. Its Tmall store’s sales in 2020 reached 100 million yuan, and now its monthly sales are about 10 million yuan.

8.       Yatsen Global invested in Hangzhou Time Biotech company that has EANTim, a brand with a focus on the skin microbiome. Yatsen Global now has seven brands: Perfect Diary, Abby’s Choice, Pink Bear, Little Ondine, Galénic, Eve Lom, and EANTim.

9.       In September, 3CE, a makeup brand from L’Oreal Group opened its official store on JD.com. 3CE is a Korean fashion and beauty brand founded in 2009. This new JD store brings more than 200 ace products, covering all categories.

10.   A Chinese makeup brand, FIRENZE, gained an investment of tens of millions of dollars. It ranked first in the cross-border e-commerce platforms in the Southeast Asia market. After achieving success overseas, this brand is now expanding its business in China.

11.   High-end cosmetic retailer, HAYDON, announced that it completed A+ round of financing, securing 100 million dollars, which made its valuation reached one billion dollars. At present, it has opened five stores in China and plans to open another 15 stores this year.

Data Browsing

1.       According to the National Bureau of Statistics, in August, China’s total retail sales of consumer goods reached 3.4395 trillion yuan, a YoY increase of 2.5%. Among them, the total retail sales of cosmetics were 29.4 billion yuan, a YoY increase of 0. The retail sales growth rate didn’t perform well in August because July is an offseason for cosmetics. Besides, the market has been going through a low-key period recently.

2.       2021 Social E-commerce Innovation Development Report shows that the Chinese social e-commerce market is expected to reach 5.8 trillion yuan in 2021, a year-on-year increase of 45%. Social e-commerce develops from social media platforms such as WeChat, Douyin, and Kuaishou.

3.       Global Industry Analysts released a market research report named Vegan Cosmetic Global Market Analysis recently. The report shows that the global vegan cosmetic market value will reach 20.6 billion dollars with a CAGR of 5.1%. The Chinese vegan cosmetic market value will reach 4.2 billion dollars with a CAGR of 7.9%, above the average CAGR.

4.       In September 2021, China National Medical Products Administration (NMPA) released the cosmetic registration and notification data in 2021H1, including data on initial registration, renewal, modification, re-issuance and cancellation of special cosmetics as well as the notification of imported general cosmetics. More details on ChemLinked.

Regulatory compliance

1.       On September 1, GB/T 40146-2021 Determination of Plastic Microbead in Cosmetics is implemented. The standard is applicable to the determination of plastic microbeads in cosmetics. Other daily chemical products such as toothpaste, soap, and laundry detergent can also refer to it. Notably, the standard does not apply to the determination of plastic microbeads in makeup cosmetics. More details on ChemLinked.

2.       On September 8, 2021, China NMPA consults on the second draft Good Manufacturing Practices for Cosmetics (the Practices). 1 The number of articles in the second draft is reduced from 77 to 64, and some standards are relaxed. Compared with the first draft, the second draft relaxes the qualification requirements for the person in charge of quality and safety, the person in charge of the quality management department and the person in charge of the production management department. The draft also refines the management requirements for brands that entrust factories to produce cosmetics. More details on ChemLinked.

3.       On September 2, 2021, China's State Administration for Market Regulation (SAMR) unveiled "GB 23350-2021 Requirements of Restricting Excessive Package—Foods and Cosmetics" in replacement of GB 23350-2009, intending to address the growing excessive packaging problem. The new GB standard will come into force on September 1, 2023, allowing a two-year transitional period for stakeholders. More details on ChemLinked.

4.       Recently, China National Medical Products Administration (NMPA) published three articles on its official website to alert consumers to products claiming “enhance eyelash growth”, “stem cell” and “acid peel”, respectively. Although the articles were released as popular science articles, they contain regulatory implications for cosmetic companies. More details on ChemLinked.

5.       On September 18, the National Medical Products Administration (NMPA) released the List of Medical Devices Exempted from Clinical Evaluation and the List of In Vitro Diagnostic Reagents Exempted from Clinical Evaluation. Both are scheduled to take effect on Oct. 1, 2021. More details on ChemLinked.

6.       China NMPA consulted on five standards relating to cosmetic supervision data, including 1) basic data set of cosmetics production license management, 2) basic data set of ordinary cosmetics products record-keeping system management, 3) basic data set of special cosmetics record-keeping system management, 4) basic data element of cosmetic administration information, and 5) coding for value domain of cosmetic administration information basic data element. More details on ChemLinked.